…start being more impressed by the 500% ROI, not the $500 million dollar budget.
We’ve all seen the numbers; in fact, many productions tend to wear those numbers like a badge of honor. As of this writing, only one movie has ever had a production budget of over $400 million (technically only $378 Million After Tax Rebates) — Pirates of the Caribbean: On Stranger Tides. A record that is set to be broken by the upcoming Avengers: Infinity Wars, Part 1 and 2, which will have a total $1 billion production budget between the two productions. Technically, you can try and justify these types of budgets after the fact. As Pirates made over $1 billion at the box-office, but do keep in mind, that the $410 million dollars does not include marketing costs.
We need to remember, that for every big budget success, you also have movies like John Carter, which despite making $284 million, is considered a box office flop. Largely because of the $306 million dollar production price tag (again, not including its marketing budget.) John Carter wouldn’t have been considered a box office success (not a hit, just a success) unless it made over $640 million, which would have put it on the top 100 highest grossing movies of all time. (Please note, Thor: The Dark World grossed $644 million.).
In terms of profit, on the top 100 highest grossing movies of all time, the infamous Avatar, often (incorrectly) referred to as “most profitable movie” of all time, only had a 37% return on investment. However, this is NOT the most profitable movie of all time, not even on the top 50 list. The honor of most profitable goes to Paranormal Activity with a 19,749% ROI.
Now, I know what you are thinking, Paranormal Activity was one of those one in a million indie movies, more then that, it sure isn’t one of those franchise Hollywood big budget movies like the marvel superhero movies. Wait; hold your horses boys and girls, because by far the largest ROI of a superhero movie anywhere goes to the relatively low budget ($48 million) of the Deadpool movie. Deadpool has a whopping ROI of 500%.
I can easily be accused of cherry-picking numbers here. Perhaps I am, but let’s remember so does every other PR stunt dealing with Hollywood movies talking about box office numbers and production costs (note Avatar above). Why? Because big numbers impress people. It’s just often the case that the wrong big number impresses them. We need to start being more impressed by the 500% ROI, not the $500 million dollar budget. When someone comes to me and says, my film just got a $100 million budget approved! I give them a good high five, a “that’s awesome man!” because it is awesome and they do deserve that high five. Then my analytical mind kicks in, and I think to myself, “it’s entirely possible he will only get a quarter of that, his poor investors ROI’s are going to take such a huge hit.”
We need to stop looking at $ signs and start looking at percentages when judging success. This is the film business, the entertainment industry; it does not matter if you’re a producer or a director, if you call yourself a filmmaker or a content creator. As a professional you need to remember that judging your financial success goes beyond that surface number of views, or likes, or subscribes or gross ticket sales.
BY DAVID FLORIN